Daily ESG Briefing: NBIM enters renewables infra space in €1.4bn deal with Orsted

The latest developments in sustainable finance

Norges Bank Investment Management has made its first investment in renewable energy infrastructure in a €1.4bn deal with Ørsted. In 2019, Yngve Slyngstad stepped aside as CEO of the sovereign wealth giant to lead its new renewables strategy. Now, it has taken a 50% stake in a wind farm of the Dutch coast. Meanwhile, Insurance company MAPFRE has signed a strategic alliance with utility Iberdrola to make joint investments in renewable energy in Spain. The pair have created a co-investment vehicle using 230MW of Iberdrola’s wind and solar projects, which it plans to grow to 1GW. MAPFRE owns 80% of the vehicle. 

The International Auditing and Assurance Standards Board has issued guidance on assuring ‘non-financial’ reports. Chair Tom Seidenstein said the guidance would, when used alongside existing international standards for assuring non financial information and greenhouse gas disclosures, “form a strong package that will help enhance confidence in assurance reports and improve their reliability, including enabling practitioners to respond to new reporting regimes”.

More than half of Europe’s bank directors are ‘compromised’ through close links with fossil fuel and highly polluting companies, claim investigative journalists at DeSmog. The platform’s analysis found 61% of directors at 15 major banks have held positions at carbon-dependent companies, with 34% currently holding such roles. ABN Amro, Lloyds and HSBC had the highest proportions of directors linked to industries including oil and gas, coal and shipping, according to the research. Geoffrey Supran of Harvard University said the findings exposed the “revolving doors” between fossil fuel companies and financial decision makers. 

The Network for Greening the Financial System (NGFS) is launching a research project to understand the consequences of biodiversity loss for financial stability. The central banking group is partnering with the International Network for Sustainable Financial Policy Insights, Research, and Exchange (INSPIRE) to carry out the research. Frank Elderson, Chair of the NGFS, said: “The financial risks that stem from a loss in biodiversity are a serious threat to the financial sector that urgently require better understanding by policymakers and regulators.” 

US Treasury Secretary Janet Yellen told the Coalition of Finance Ministers for Climate Action yesterday that the US was working domestically and globally on improving the quality and comparability of climate risk data. She said that the country also sought “to coordinate approaches among regulatory agencies to address climate risks; and to examine potential systemic consequences of climate change”. “We are also supporting international efforts to better identify climate-aligned investments and encourage financial institutions to credibly align their portfolios and strategies with the objectives of the Paris Agreement,” she added.  

Student-managed investment funds in US universities are increasingly adopting sustainable investing strategies, according to a new report. The Intentional Endowments Network found even many higher education institutions that have been reluctant to divest from fossil fuels already have more sustainable funds managed by students. With $68.4m in assets already under management in such funds, the network says institutions should “strongly consider” setting up their own. 

Citi is incorporating ESG scores into its securities data platform, Velocity Clarity, to allow clients to analyse the sustainability exposure of their holdings at the portfolio and security level. The scores come from German data provider Arabesque S-Ray, which the bank also uses to develop its recent ESG indices. “Citi plans to work with clients to continue to develop the scope and functionality available through Citi Velocity Clarity, including incorporating additional ESG data from other providers,” it said. 

Japan's Financial Services Agency and the Tokyo Stock Exchange are seeking  feedback on their proposed new Corporate Governance Code and Guidelines for Investor and Company Engagement. The two sets of guidance have been updated in accordance with recommendations published yesterday by the Council of Experts Concerning the Follow-up of Japan’s Stewardship Code and Japan’s Corporate Governance Code. The public consultation is open until May 7. For more details on the proposals, see RI's coverage here